Date: 29 th October 2010 QUARTERLY ACTIVITIES REPORT ENDING 30 SEPTEMBER 2010 HIGHLIGHTS Encouraging nickel results received for the Falcon Bridge Project. Second round of drilling at Falcon Bridge Project completed. Mt Watson VTEM survey results processed and have highlighted significant drill targets. Boomarra ground gravity results have been modeled and highlighted significant anomalies for drill testing. 100% owned exploration tenements in application in WA and SA has increased to 22 with a total area of over 9,000km 2. Target minerals include iron, gold, nickel, copper, lead, zinc, uranium and mineral sands. Negotiations with potential strategic Chinese partners are in progress. Figure 1 Ishine Project Locations T: +61 8 6142 5088 F: +61 8 9200 5638 Web: www.ishineresources.com Email: admin@ishineresources.com Page 1
1. ENCOURAGING DRILLING RESULTS FROM FALCON BRIDGE JV NICKEL PROJECT During the June Quarter Ishine s maiden drilling program included a total of 72 aircore holes for 3,459m across six east-west traverses at the Falcon Bridge Project 80km north of Laverton. Assays were received during the quarter and confirmed the ultramafic host rock was present, beneath transported cover, and up to 800m thick. It also highlighted several zones of interest anomalous in nickel, copper and MgO. Encouraging results included: 23m @ 0.41% Ni and 262ppm Cu from 51m in drill hole FBAC004 33m @ 0.58% Ni and 125ppm Cu from 30m in drill hole FBAC017 39m @ 0.41% Ni and 170ppm Cu from 36m in drill hole FBAC058 3m @ 0.55% Ni and 280ppm Cu from 36m in drill hole FBAC041 Aircore drill hole intersections with greater than 0.4% Ni are tabulated below. Hole ID Easting Northing RL Dip Azimuth Depth From To Interval Nickel % Cu (ppm) FBAC004 443000 6914300 500-60 90 74 51 74 23 0.41% 262 FBAC005 442900 6914300 500-60 90 44 27 39 12 0.44% 109 FBAC012 442500 6914600 500-90 0 46 27 42 15 0.43% 39 FBAC016 442900 6914600 500-60 90 53 33 53 20 0.57% 26 FBAC017 443000 6914600 500-60 90 63 30 63 33 0.58% 125 FBAC023 442600 6914844 500-90 0 63 54 57 3 0.41% 14 FBAC033 442600 6915200 500-60 90 57 45 51 6 0.40% 23 FBAC041 443300 6915700 500-60 90 64 36 39 3 0.55% 280 FBAC042 443200 6915700 500-60 90 42 30 42 12 0.44% 58 FBAC048 442600 6915700 500-90 0 38 33 36 6 0.51% 30 FBAC049 442500 6915700 500-90 0 45 36 45 6 0.42% 34 FBAC053 443000 6915900 500-60 90 38 33 38 5 0.53% 33 FBAC058 443050 6914600 500-60 90 83 36 75 39 0.41% 170 FBAC064 442450 6915700 500-60 90 59 51 57 6 0.63% 45 FBAC068 443250 6915700 500-60 90 51 36 51 15 0.69% 56 FBAC072 442650 6915200 500-60 90 37 33 37 4 0.51% 55 Table 1 Significant Aircore intercepts >0.4% Ni In order to follow up these anomalous results, Ishine proposed and executed a round of RC drilling which included eight holes for 1,199m. These holes were designed to test the more interesting results beneath the base of weathering and, where possible, test along the interpreted basal contact position. Results from this program are pending and are expected during the next quarter. T: +61 8 6142 5088 F: +61 8 9200 5638 Web: www.ishineresources.com Email: admin@ishineresources.com Page 2
Aircore Drilling Collars Proposed RC Collars Figure 2 Falcon Bridge Aircore and RC collar positions over TMI image. 2. DRILLING TARGETS IDENTIFIED FROM MT WATSON VTEM During the reporting quarter, Ishine received the results of data processing and geophysical modelling from the Mt Watson VTEM survey flown recently. The results indicate significant zones of conductivity along strike of the Mt Watson mineralisation (8.01mt @ 0.9% Cu) within the Surprise Creek sediments. A number of high to low order anomalies were generated from this survey, several of which will be drilled next quarter. Presently a heritage survey is underway and drilling is anticipated for early November over three of the strongest anomalies shown in Figure 3 and Figure 4. T: +61 8 6142 5088 F: +61 8 9200 5638 Web: www.ishineresources.com Email: admin@ishineresources.com Page 3
Figure 3 Strong anomalies from VTEM at the Mt Watson JV project T: +61 8 6142 5088 F: +61 8 9200 5638 Web: www.ishineresources.com Email: admin@ishineresources.com Page 4
Figure 4 Drilling targets defined from strong VTEM anomalies at the Mt Watson JV project 3. GRAVITY ANOMALY FOUND FOR THE BOOMARRA PROJECT During the quarter, Ishine received the results of modelling of the gravity survey which was carried out in May. The detailed survey included 1,555 stations and has been effective in generating several drill targets associated with coincident or nearby areas of magnetic anomalism. Heritage clearances are currently underway prior to a drilling program scheduled for next quarter. T: +61 8 6142 5088 F: +61 8 9200 5638 Web: www.ishineresources.com Email: admin@ishineresources.com Page 5
Figure 5 Gravity survey stations defined over magnetic anomalies in Boomarra JV project Figure 6 Boomarra Gravity anomalies overlapping with magnetic anomalies T: +61 8 6142 5088 F: +61 8 9200 5638 Web: www.ishineresources.com Email: admin@ishineresources.com Page 6
4. NEW EXPLORATION LICENCE APPLIED The Company continued its effort in securing 100% owned exploration tenements through aggressive search for quality ground in Australia. Eight new exploration licence applications were lodged during the report period to the Western Australian Department of Mines and Petroleum and the South Australian Department of Primary Industry and Resources. By the end of September 2010, the Company has secured twenty-two 100% owned exploration licences in application with a total area of over 9,000km 2. Target minerals cover iron, gold, nickel, copper, lead, zinc, uranium and mineral sands etc. The size, location and target minerals in each of the exploration tenements applied are presented in Table 2 below. Table 2 Ishine's New Exploration Tenements Applied before 30 September 2010 State Tenement Number Date Applied Size, km 2 Locality Target Minerals E38/2435 9-Apr-10 71 Laverton Ni, Au E70/3880 15-Apr-10 225 Narembeen Au E77/1786 19-Apr-10 225 Merredin, Narembeen and Yilgarn Fe E80/4448 18-May-10 496 Halls Creek Zinc, Lead WA 3,542km 2 E04/2031 18-May-10 261 Derby Copper, Lead, Zinc E80/4450 14-Jun-10 132 Halls Creek Ni, Cu, Co E37/1073 24-Jun-10 106 Laverton Ni, Au E39/1582 24-Jun-10 90 Laverton Ni, Au E37/1074 24-Jun10 84 Laverton Ni, Au E69/2810 24Jun10 644 Gunbarrel Cu, Ni E69/2811 24-Jun-10 631 Gunbarrel Cu, Ni E69/2812 24-Jun-10 451 Gunbarrel Cu, Ni E80/4478 21-Sep-10 126 Halls Creek Ni, Cu, Co SA 5,527 km 2 E196/10 28-Jun-10 699 Tarlina Cu, Ni, Pb, Zinc, Mineral Sand EL197/10 29-Jun-10 648 Tarlina Cu, Ni, Pb, Zinc, Mineral Sand EL198/10 1-Jul-10 218 Ooldea Range Cu, Ni, Pb, Zinc, Mineral Sand EL234/10 28-Jul-10 340 Mulga Wells Au, Co, U EL239/10 4-Aug-10 992 Mulgaria U EL252/10 18-Aug-10 218 Willouran Ranges U EL259/10 25-Aug-10 969 Willouran Ranges U EL260/10 25-Aug-10 690 Willouran Ranges U EL261/10 25-Aug-10 753 Willouran Ranges U Summary 21 Tenements 9,062 WA and SA Fe, Cu, Ni, Au, Pb, Zn, Co, U, Mineral Sand T: +61 8 6142 5088 F: +61 8 9200 5638 Web: www.ishineresources.com Email: admin@ishineresources.com Page 7
5. NEGOTIATION WITH POTENTIAL STRATEGIC PARTNERS The Company has been in vigorous discussions with potential strategic Chinese partners for long term growth and in a preparation for undertaking mineral exploration over large area of tenements under application. The Company also continued its effort in searching for and evaluating advanced exploration projects for possible acquisition. Caigen Wang Managing Director -END- The information in this announcement that relates to Exploration Progress has been prepared by Mr Martin Dormer, who is a member of the Australian Institute of Mining and Metallurgy, and a full time employee of Ishine International Resources Ltd. Mr Dormer has sufficient relevant experience in the techniques being reported and styles of mineralisation and types of deposit under consideration, and in the activity he is undertaking, to qualify as a Competent Person as defined in the 2004 Edition of the Australian Code for Reporting of Exploration Results, Mineral Resources and Ore Reserves (the JORC Code), and consents to the inclusion of the information in the form and context in which it appears. For further information please contact: Caigen Wang Managing Director Martin Dormer Chief Geologist T: +61 8 6142 5088 T: +61 8 6142 5088 cwang@ishineresources.com mdormer@ishineresources.com T: +61 8 6142 5088 F: +61 8 9200 5638 Web: www.ishineresources.com Email: admin@ishineresources.com Page 8